Phil, I followed your investing ideas in LTP quite closely. It seems your insightful fundamental analysis knowledge serves you v. well. I get entertained and they are profitable.

- Investwizard

Thanks, Phil. I really appreciate your sentiment and commitment! Just want to thank you for what you do for all of us.

- JBaker

I traded with Phil for approximately three years, and consistently averaged 80% returns yearly... some of which was due to my skills as a trader, but much was a direct result of what I learned as a member of Phil's site.... both from Phil, and the many talented traders that hang out there. Phil... if you are reading along... thanks, again for the approximately $ 3 mil I made tagging along with you.... in order to make you feel good for the work you did... I gave the government 50% of it all, so you made your contribution....

- 1234Gel

Phil…..You have absolutely NAILED IT! This is not a bull market, nor is it a bear market. It is a Rangeish market, and it's going to stay that way for a long time (the latter is my prediction. I love the word. What I love more is the fact that I've found someone with some investing intelligence greater than mine who can assist me in playing this type of market. Your description today of how it's playing out is right on. I predict some media ‘guru' will steal your word and your description within the next few days and we'll all get to read about what ‘they' discovered about this market. Thanks Phil!

- Iflantheman

Fed days are fun! Just for grins I decided to see how much money I could make in two clicks. I bought DIA calls right when the surge started and then sold them the minute they hit my account. Net gain of 20% in 20 seconds. Can't do that very often…

- MrMocha

PSW AC Conf: For those who may be on the bubble, I attended my first PSW LV in November. It was a real eye-opener. What I accomplished in a couple of days of exposure to Phil, Pharm, Craig, et al made my previous couple of years of hanging around the web site seem silly. If you are inclined in the slightest, you really should go. Just rubbing shoulders with other PSW members proved to be really valuable. Strictly on the basis of value, it's a great deal. You will have real time conversations with Phil and the gang and they will get to your questions and agenda items.

- Mjjwo9b

Praising PSW for enlightenment is a bit akin to praising the Pope for being holy. I've been reading PSW for about two months now and have learned more about investing technique and the world in general than I've learned from the books and seminars I've paid for. Thanks for the enlightenment, the education, the guidance and the truth, which is not a commodity these days, but a virtue in short supply.

- Andy Morris

Thanks, Phil!!! I just crushed today with it with silver (SLV) calls today, thanks to your persistent reminders of how ridiculously cheap it has become, and watching my TSLA this week $240 puts dissolve into chump change added an extra note of amusement.

- Zeroxzero

I enjoy your informative materials, Phil... as it is obviously beneficial to so many "styles" of trading the markets... long term, swing or day trading the market moves.
As a longer term trader, I really like you long term calls, as I for one recognize the difficulty of calling these, because the further out you go in time, projecting price movement becomes more difficult.
I have to congratulate you for your accuracy... You called the March 2009 market upward reversal almost to the day, and the AAPL reversal to THE day. Only one who has been a student of the economy and the markets over a period of time could have done this, and so many other accurate calls. I'm sure it was difficult and consistent work, but it did pay off... thanks from one who benefited big time !

- 1234Gel

Don't expect to get rich quick here, but you can get easy 30 - 50 % per year, just by buying good stocks at discount (as we often discuss), selling monthly premiums of calls and puts.

- Tchayipov

Phil, have to thank you for saving me today. I think the discipline I have learned from this site has helped me as much if not more than the actual picks.

- Rustle123

I have to thank you for excelling yourself during this past week. I have spent a good few hours going over your notes and comments and there are so many gems on repairing and rolling trades that I have been beavering away on paying special attention to my major positions and analysing them using your approach on Tuesday. Being able to look at a group of trades on the same underlying (in this case AAPL) and taking a detached view by assessing the impact of the underlying reaching different price points was extremely reassuring.

- Winston

Phil, those OIH $80 p that you recommended last week for ~$1 are now worth $5.50!

- Greg

Happy Thanksgiving Phil and to your family and associates. Also to all of the other fellow citizens of Phil's Stock World. I am particularly happy and thankful that I clicked on your article in Seeking Alpha a number of years ago. That opened the gate to Phil's Stock World and "being the house". My wallet thanks you as does my peace of mind in trading options, stocks and rarely futures. Your liberal views opened up my views—being a boot strapper (pulled myself out of a poor background) I was a CONSERVATIVE—cynical of others who weren't as driven. Now, I am much less so; you have taught me more than how to make money and manage risk. So, again I give thanks to you and the others of PSW!!

- Newthugger

I don't post much, but I guess this morning has brought me out. This site has made me tens of thousands, every year since I have become a member. It took me nearly two years devoting 3 hours per day to get on the ball, and actually understand portion sizing, and which trades fit my personal trading style. Before that I spent at least two years working on Buffet style fundamental investing. (Intellegent Investor, Security Analysis, ect.). This site really will teach you amazing things if you just pay attention. Literally it has changed my day to day life, has allowed my family and I to move back to the U.S. from overseas with confidence even with a paycut at my day job, and literally put me in a different league financially. Seriously my life and my children's is better because of this site.

- Knightpilot

Phil: UNH, hedged stock position, doing great, up over 50 %,

- RMM

All I can say is — I understand that the Universe sent me to PSW for a reason. So, I'm listening!! …and studying. Your commentary is literally outstanding. …and your members are impressive as well.

- Seaquill

Boring trading – Phil/ Thanks to PSW, my yearly covered-writes are on pace for 15%. Add the long puts and well over 20%… and I look at it once a day and never lose sleep over it. Actually doing better than my trading account at this point (Thanks, summer 2013)
Anyway, the point is that anyone with enough money would be wise to do the 20% – 40% stuff and do trading as a hobby…

- Arivera

Newer member here, but just wanted to say thank you too. I've learned so much and I hope you'll be around for a long time helping us learn along the way.

- Where

Thanks to Phil (again) for the lessons on the art of the roll, selling premium and hanging tight under fire (particularly in the first hour of trading-MADNESS). Watching you manage the $25KP has really helped my trading in a big way.

- Oknoman

Phil/thankyou. Phil, I went over the recording of last weeks webinar. I liked it a lot and wanted to thank you. I thought the case studies (company reviews) were detailed, I learned more about selling puts process and also what happens if stock continues to go down after that, I liked the fact that we discuss so many different avenues like stocks, optiond, futures, oil, commodities etc… I replayed portions of it multiple times to make sure I was grasping it but wanted to say good job. Thanks…

- Nramanuja

Phil, You were on the $ today with your calls almost exactly on the turns – Krap kuhn krup (Thai for thank you very much).

- Jomptien

Thanks for the USO directions today. Made it 3 times (up/down/up) for a very nice win.

- Doro165

Phil: I loaded up big time yesterday on your suggestion of the AMZN September 75 naked puts. They are up 43%!

- Gel1

Personally I admire and respect you disciplined approach to investing. My style is at the extreme side of aggressive and I have to learn how to be less that way. If I yell " Let it Ride" at my house, no one says a word so I can't use that to temper my behavior. Phil has done a pretty good job of knocking some of my potential moves and as a result, I have increased my portfolio value by almost 25% since late July.

- DoubleD

Phil, I've got to give you props on the ICE spread play. Tremendous call! I jumped in on Friday when you made the recommendation and closed out today. Nice 57% return ($2,300) over a mere 3 trading days! This is why I dig your site!

- Samlawyer

Thank God for Phil.
A few months ago (April) I didn´t even know what hedging was, and someone recommended I should check out some of Phil´s plays, especially on the retirement portfolio. When I first started to read it, none of it made a blind bit of sense to me, but I stuck with it and gradually began to work through some of the trades to see how it worked. Now I am putting on 5:1 SPY backspreads combined with bear put spreads, entering and leaving positions after consulting the VIX, and engaging in other esoteric maneuvers that are keeping my portfolio above water.

- jmm1951

Great calls this week!

- SNS1

Phil, I have to hand it to you. It seemed that you were the only person on the planet that thought stocks falling was still possible. I am glad I listened. About the end of the year I was really beginning to second guess though. Thanks for suggesting taking some profits last Nov. It no longer looks like I missed much.

- rj_jarboe

Very nice in and out on those USO puts again, easy way to get the subscription covered in just a couple of hours.
Thanks again Phil and everyone here contributing to such intelligent and informative discussion! I have wasted countless hours reading "professional newsletters" and message board blather over the years. Have learned a great deal here in a very short time. I have sent out a number of invites to friends and family for stockworld!

Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

I have followed a lot of Phil's picks over the last several years and made money using the exact option strategies he outlines. Of all the contributors on SA, he offers the most actual and ready to implement advice that has put money in my account. Many of us on SA actually are sad when we don't see Phil's postings for an extended period.

- Brenteaz

USO, QQQ- Phil, thanks for these plays. Out of USO for about 65% gain today and just keeping 1/4 QQQ.

- Ksone88

GIVE THANKS/PHIL
Have not done my 10,000 hours, but a couple of years at PSW, and moved from fishing with a single line to owner of a commercial trawler (metaphorically speaking). Now I fish with many lines. It is amazing when you go over the same information time and time again, eventually it clicks. Like planting trees; being the house, 20% sale items, selling into the excitement. and patience. I just sold an AAPL Jan 12 340/390 BCS financed by the sales of Jan 12 275 Put. The trade was put on one year ago for a net credit and exited five minutes ago for a 49 dollar per contract profit. No point in waiting till opex to see what happens, and I will just sell 10 of those VLO puts to make myself net the round 50.
I no longer worry about opex coming as I have adjusted well in time for most positions that go against me. I still make some howlers (RIMM, TBT, TRGT) but I play the percentages and my winners outdistance my losers by many miles.
I would never be in this position if it were not for Phil. He is a treasure, pure and simple. The goose that lays the golden egg if we care to listen and practice. Phil, a mighty big thank you.

- Winston

As a retired stockbroker from a major Canadian brokerage firm, I can tell you I would never had access to these type of trade ideas, especially the hedges.
Just closed out a July TZA 40/45 call spread today for a 271% gain in less than a month. I would have normally let that run but yesterday Phil commented to another member something to the effect that "you put down a $1 for a $5 upside, now that you are up 250% you have $2.5 in and you are hoping for a double."
Just closed out a USO July $38 put that Phil suggested yesterday for a 49% one day gain.
Thanks,
Bob

- RJK

Phil - Your logic not only makes sense, but it made a lot of premium profit for me over the past 12 months. I have recovered much of the massive equity losses of last year. My Monday play is the sale of long term puts on FXI. Love the premium!

- Gel1

TBT - Many thanks, Phil. I join you in your opinion favoring the Jan expirations. That's a great play. I can never thank you enough for what I have gained educationally as well as monitarily. Here it is late Sunday evening and I am able to get world class advice, just by asking for it. I feel like I am staying in a 5 star hotel, and room service is just a telephone call away!

- Gel1

I'm just starting my second year as a member, and I'd like to thank all of you for sharing your trading ideas and insight, and especially Phil of course for great all-around investing advice as well as trades! In addition to learning patience and profit-taking, I think one of the most important things I'm learning here is to stick to stocks and trades that suit my temperament. And wow, I had NO idea how hard it was to learn patience. I should say "practice" instead of "learn", because it seems to be a constant struggle. Phil, please keep reminding us how nice CASH is!

- Jerseyside

By the way thank you Phil for the DNDN idea. 3x till this morning and will 4x my small investment by next OE THANKS !!!!

- Microflux

Phil you are great, and not only is your market info spot on but you have the courage to call it like it is and write about it in a great tone.

- Flanger

Kudos on the POT puts! I studied the charts last night and you couldn't have hit the inflection points more perfectly. Since there are often many head fakes in the charts, that was very well done. I know they can't all work this well, but that was an extra unexpected bonus yesterday.

- Ocelli7

Phil, i wanted to thank you again for helping me protect future stock allocations at work - finally, i feel like i am owning my own destiny with stocks vs. letting the market dictate what you get – thanks again.

- Nramanuja

Phil - I celebrate today, having reached my goal for the year, trading in sync with your education and guidance, of 1 million in profit. I learned a lot, achieved much, and am profoundly grateful. To be honest, when I set the goal I thought it was daunting, as I have for many years been an investor in equities but did very little with options. Learning and doing has for me been a blast!
I reached my goal by following Phil's strategies - lots of Buy/Writes, covered calls on equities , naked put entries for income production. I did it with 2.5 mil and kept 600,000 in cash in case I got in trouble. I concentrated on stocks (many of my own choosing) that had decent dividends and wrote front month calls against (OTM) which has worked well in this market run. 25% of my gain is in dividends and premium selling, with the balance in appreciation.

- Gel1

Phil, I don't know if I told you lately but you da man! I'm doing so much better following your guidelines. It's like you actually know what you are talking about. 8-) I've tried a lot of services and none of them are as comprehensive or honest AND successful. I appreciate all youz other guys/gals input as well…learning tons as a relative newbie to this game.

- Aclend

I took $2 (up 133%) and ran on those USO puts, quite a bit more than the 20 you played in the $25KP. Thank you once again for turning a bad market week into a great personal week. You will be happy to know I am back to cashy and cautious with a few of your favorite longs into the weekend. Thanks to Phil, JRW and all the members who share their knowledge here.

- Dennis

I enjoy your informative materials, Phil... as it is obviously beneficial to so many "styles" of trading the markets... long term, swing or day trading the market moves.
As a longer term trader, I really like you long term calls, as I for one recognize the difficulty of calling these, because the further out you go in time, projecting price movement becomes more difficult.
I have to congratulate you for your accuracy... You called the March 2009 market upward reversal almost to the day, and the AAPL reversal to THE day. Only one who has been a student of the economy and the markets over a period of time could have done this, and so many other accurate calls. I'm sure it was difficult and consistent work, but it did pay off... thanks from one who benefited big time !

- 1234Gel

Phil, I have to hand it to you. It seemed that you were the only person on the planet that thought stocks falling was still possible. I am glad I listened. About the end of the year I was really beginning to second guess though. Thanks for suggesting taking some profits last Nov. It no longer looks like I missed much.

- rj_jarboe

In options trading, one must remain flexible with the ability to adjust to take advantage of the unexpected moves in the market. It is like chess - spend most of your time strategizing the next move. A good understanding of options is necessary to change direction and make adjustments as the market moves against you. I have a friend that honed his option skills while a member of Phil's elite membership over a period of two years. With the education acquired, he made over $2 Mil in that period, trading options and following the plays put on by Phil. If making money is your goal, then he is the go-to guy, as he knows option strategies better than anyone, and market timing is also a skill he has mastered.

- 1234gel

Phil/thankyou. Phil, I went over the recording of last weeks webinar. I liked it a lot and wanted to thank you. I thought the case studies (company reviews) were detailed, I learned more about selling puts process and also what happens if stock continues to go down after that, I liked the fact that we discuss so many different avenues like stocks, optiond, futures, oil, commodities etc… I replayed portions of it multiple times to make sure I was grasping it but wanted to say good job. Thanks…

- Nramanuja

There are a lot of us that have been here a long time and we all learn something everyday. Just keep asking questions, there are a lot of smart people here and they are willing to help and then of course, you have Phil.

- Jr Mints

Phil… My portfolio, in the past few months, has acheived a high degree of stabilization. I've noticed that on up days, down days, even days, it doesn't matter, my portfolio rarely varies more than 2%. And over the long haul it just slowly increases in value. I attribute this not to investment choices, but to style. Thanks to you and others on this site I'm paying close attention to position size, delta neutrality, downside protection, and concentrating on selling premium rather than buying it. I've developed increasing patience, not having to trade daily, or even weekly. I'm concentrating on the finer points of trading, letting the profits come to me, rather than the other way around. I appreciate the help everyone here has given in getting me focused on this principle. I'm pumped!…in a calm sort of way.

- Iflantheman

Phil/USO Adjustment~~ Thanks for showing us the make it even (maybe even profitable) tricks for 'fixing' a losing position. I would have never known the trick if you didn't explain it. The option adjustment techniques are very helpful. Trading stocks would probably never offer that kind of flexibilities! Thanks!

- Investwizard

/NKD- Kownichiwa Cowboy!! One week of patience and scaling in and out pays off. This is a testament to Phil's fundamental analysis with the PSW technique. Thanks Phil.

- JohnO

Phil/CLK4 – Perfect! Saw the answer 1 min after my post…out with $740 on two contracts. Thanks again for the education.

- Jeffdoc2004

Phil, I just wanted to say thanks for being there. The world needs more of you. Your site continues to positively change my life daily.

- Chasw

Personally I admire and respect you disciplined approach to investing. My style is at the extreme side of aggressive and I have to learn how to be less that way. If I yell " Let it Ride" at my house, no one says a word so I can't use that to temper my behavior. Phil has done a pretty good job of knocking some of my potential moves and as a result, I have increased my portfolio value by almost 25% since late July.

- DoubleD

The strategy you have laid out pretty much mirrors much of my trading activity. I also mix in some momentum plays and "drop dead" bargains that come across my radar. My YTD trading profit is 63%. Back in March when Phil said "unless you think the world is coming to an end, then NOW is the time to start taking positions in Buy/Writes with the VIX so high." I jumped in with both feet - ( thanks, again Phil)

- Chaps

Phil: I have 263 positions - 70% in options ( balance stocks) in three portfolios with a value of 3 mil. YTD profit is about $750,000. Thanks!

- Gel1

Phil.... I remember back in March of '09, you stated " Unless you think the country is going to hell in a hand-basket, NOW is the time to do your buying". Do you remember ?
I took your advice, and bought leap $2.00 calls on F, approximately 200,000 shares using the options, for just pennies. Now that was the best Ford I ever owned.... made over $1 mil - thanks go to you Phil. I now drive a Mercedes but still "love" the Ford.

- 1234Gel

Greetings Phil,
I am an Economist at Harvard and some of my colleagues and I would like to let you know that we follow your posts on SA, and find your analysis refreshing, rigorous, and acute. Great work! Though many of us (including myself) have our work covered in the Wall St Journal, in many ways your macro commentary is more fearless and accurate than what is generally found in that venerable publication.
Kind regards,
Daniel

- Daniel

A truly great website with a lot of information for investors. Whether you are a novice, seasoned, or a professional there is a lot to be gained about stock options and options trading from this very informative website.

The dollar rose against the Yen for the first time in 5 days and the most in 2 months this morning.

Bernanke finally came out of his stupor and said the Fed is ready to tighten monetary policy once the economy improves. Once the economy improves? Hasn’t Ben been telling us how great everything is for the past 3 months??? The Dollar Index, which tracks the currency against six U.S. trading partners, recovered from a 14-month low after Bernanke signaled interest rates may rise when the economy “has improved sufficiently.” The yen dropped against all but three of the 16 most-traded currencies after Japan’s machinery orders gained less than forecast.

“People took the comments as an opportunity to take some money off the table before the weekend,” said Simon Derrick, chief currency strategist in London at Bank of New York Mellon Corp. “They came at an opportune time and allowed some people to get some profit out from bets against the dollar.”

We’ve been talking dollars all week at PSW because it has been my opinion that there has been nothing supporting this rally, especially on the commodity side, other than dollar weakness and fears of further dollar weakness. It’s been a case of so far, so wrong though as our short plays have gotten hammered this week and I was thinking of opening this morning’s post by saying: "Hi, my name is Phil and I’m a shortaholic" because, try as I might, I have been unable to stop taking short positions all week. Even yesterday, as we tested (but did not break) our upside target levels, I found myself putting up 8 bearish trade ideas for Members (DIA puts, FSLR puts, GLD puts, USO puts, EDZ calls, TBT calls, TZA calls, SRS calls) and just one bullish play, which was a DIA vertical spread to cover, just in case we got burned by today’s open.

Fortunately, it doesn’t look like I’ll have to do a mea culpa this morning as FINALLY the dollar is finding some support at pretty much the exact same place we found support on 9/23, which was the beginning of our last 5% downtrend in the market. We’re not going to get too excited though and we’ll try to balance out a bit into the weekend but at least a small bit of sanity is creeping back into the markets as people begin to realize that they can’t count on the dollar to support $1,050 gold or $70 oil. Now traders will have to scramble for fundamental arguments to support paying 50% over last October’s price for gold and 100% over last October’s price for oil in an economy that has not really gotten any stronger at all since that time.

Not getting much coverage in the US media is the move I predicted earlier this week – the Asian Central Banks are intervening in the currency markets to stem the appreciation of their currencies against the dollar. The central banks identified by traders as substantial buyers of US dollars included Thailand, Malaysia and Taiwan. Hong Kong and Singapore, which both have managed currency regimes, were also buyers. Traders said that the central bank interventions appeared to be aimed at controlling the pace at which the US dollar declines rather than solely to stop Asian currencies appreciating. Simon Derrick, at Bank of New York Mellon in London, said: “Other Asian central banks outside China are naturally looking to aggressively defend their competitive edge against undesirable currency strength as the dollar weakens.”

The Nikkei was certainly pleased with this action and that index rose 1.9% this morning, back just over 10,000 (10,200 is recovery) despite a poor showing from August machine orders as exporters were greatly relieved to see the dollar back over 89 Yen. Shanghai came back from their week off and popped right up to the 5% rule but that was to be expected after a week off. The Hang Seng was not playing catch-up and flatlined while the BSE lost 1.2% and is now down 3.2% for the month. The Baltic Dry Index is kicking back up strongly off the bottom but our Trade figures were not all that encouraging but are rebounding somewhat and our own Trade Deficit was $30.7Bn as our exports increased 0.2% and imports decreased 0.6% – yet another indicator of lack of US demand.

Despite the lack of actual demand in the inventory reports, the retail sales number or the import data, the IEA raised their forecast for oil by 200Kbd to 84.6Mbd, less than 7Mbd under global production capacity. Interestingly, despite this "good news" for the oil industry, British fund manager Neil Woodford sold his stakes in BP (BP) and Shell (RDS.A); the positions totaled 8% of his $28.8Bn funds. It’s "getting increasingly expensive to find new oil and gas reserves, and when you look at the cash-flow dynamics, you see that at the sort of oil prices we are now seeing, both Shell and BP fail to generate enough cash to cover both their capital expenditure and their dividends," he said. I’m going to go with the guy managing $28Bn and stay short on OIH and the majors…

Europe is down slightly just ahead of our open, recovering from a half-point dip in early trading. "After recovering strongly, markets might appear to be losing some of their momentum. Nevertheless, we expect equity markets to remain in a generally positive mood," said an equity note from Erste Group. Among the European blue-chips, Telefonica was the biggest gainer, up 2.2% after the company raised its dividend for next year.

We’re bearish but well-hedged but ready to get more bearish if we get a proper breakdown. As always in this crazy market, we take our bear-side profits quickly off the table because they sure don’t seem to last long. Our upside breakout levels remain Dow 9,829, S&P 1,071, Nas 2,146, NYSE 7,047 and RUT 620 and we tested but did not break them yesterday – which is why we ended up with so many bearish bets. Our aim is to go neutral into the weekend, we’re not expecting a cliff dive and Monday is a holiday and should have slow trading, which usually means an up day.

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Phil - Another excellent teaching article - when you write like that it blows me away. Thank you!
I had the ideas from earlier articles but what I didn't have was enough understanding. The familiarity of ideas through repetition, re-working, revision - over time - the variation, the pulling out of implications - it all contributes to understanding and mostly thats on the student - but a good teacher (worth their weight in gold) makes understanding a pleasure.
I wanted to learn about trading options because it makes my brain feel better - fitter, healthier. Actually mostly it makes me happy to think about the trade and trading options.
You are a good teacher and I know that or I wouldn't value the subscription the way I do. It pays for itself through the pleasure of understanding alone.

- Redfern1

Happy Thanksgiving Phil and to your family and associates. Also to all of the other fellow citizens of Phil's Stock World. I am particularly happy and thankful that I clicked on your article in Seeking Alpha a number of years ago. That opened the gate to Phil's Stock World and "being the house". My wallet thanks you as does my peace of mind in trading options, stocks and rarely futures. Your liberal views opened up my views—being a boot strapper (pulled myself out of a poor background) I was a CONSERVATIVE—cynical of others who weren't as driven. Now, I am much less so; you have taught me more than how to make money and manage risk. So, again I give thanks to you and the others of PSW!!

Being on this board is better than successfully completing the Times crossword. Phil's panoply of comments manage to excite, illuminate, frustrate, exasperate, confuse, enlighten, outrage, invigorate and stupefy (and that's par for the morning session only!). But goddammit, it's addictive, informative and when it all goes right extremely profitable.

- Winston

I've recently done exactly what Phil described. I upgraded my ability to trade the IRA acct. by transferring acct. from TDA to TOS. TDA would not allow spreads; TOS does. Neither will allow naked options. With spreads I am able to buy calls or puts several months out then sell front month calls or puts over and over. This allows me to collect premium, which is, of course, the goal. This wasn't an original idea. Phil put me onto it. Since the transfer I've substantially increased my performance in the IRA!

- Iflantheman

I traded with Phil for approximately three years, and consistently averaged 80% returns yearly... some of which was due to my skills as a trader, but much was a direct result of what I learned as a member of Phil's site.... both from Phil, and the many talented traders that hang out there. Phil... if you are reading along... thanks, again for the approximately $ 3 mil I made tagging along with you.... in order to make you feel good for the work you did... I gave the government 50% of it all, so you made your contribution....

- 1234Gel

I have followed a lot of Phil's picks over the last several years and made money using the exact option strategies he outlines. Of all the contributors on SA, he offers the most actual and ready to implement advice that has put money in my account. Many of us on SA actually are sad when we don't see Phil's postings for an extended period.

- Brenteaz

Thanks Phil, I have adjusted my position by getting rid of the IYF puts, and selling the FAZ puts. You have so many of these awesome little tricks in your playbook that it really amazes me. I toally love your analogy by the way: Do you want insurance that you have to pay for, or do you want insurance that pays you?

- Craigzooka

I am not a user of phil's site now, but was for a couple years. His advice and information is excellent. Perhaps even better, you get access to real-time trades of additional traders on his site (OptTrader, etc) and the other members who post what they are buying and selling. Overall, its a very valuable information tool. Expensive, but paid for itself many times over. I did not renew my membership because I switched jobs and did not have time to trade nearly as much.

- XRTrader

Thanks Phil, for banging the table on getting short and getting to cash. Usually when this happens in the market I am freaking out but I actually made money this week thanks to you. That HOV trade was a great way to re-deploy some of my cash.

- Julian

Phil Thank you very much, I appreciate your help and wisdom.

- CdsdpDean

In options trading, one must remain flexible with the ability to adjust to take advantage of the unexpected moves in the market. It is like chess - spend most of your time strategizing the next move. A good understanding of options is necessary to change direction and make adjustments as the market moves against you. I have a friend that honed his option skills while a member of Phil's elite membership over a period of two years. With the education acquired, he made over $2 Mil in that period, trading options and following the plays put on by Phil. If making money is your goal, then he is the go-to guy, as he knows option strategies better than anyone, and market timing is also a skill he has mastered.

- 1234gel

Phil is a fundamentalist to his fingertips. His ability to value a stock goes well beyond p/e, as he understands the essence of many businesses, what gives them value and how they make their money. As such, his recommendations are invaluable to a investor who takes a value-oriented approach.

- Zeroxzero

TBT - Many thanks, Phil. I join you in your opinion favoring the Jan expirations. That's a great play. I can never thank you enough for what I have gained educationally as well as monitarily. Here it is late Sunday evening and I am able to get world class advice, just by asking for it. I feel like I am staying in a 5 star hotel, and room service is just a telephone call away!

- Gel1

10/15/2014: Phil…..been travelling more than not but reading and watching you guys every night. This is to say a big thank you. Even though I don't have the time to trade every day now I set up hedges and base long term strategy on PSW. I now it may sound like BS to some readers but my 401k is down a mere 3%. It hardly gets my attention when I open my brokerage portfolio accounts. And that is by using your longer term hedges and strategies. I don't need to be a day trader to take advantage of PSW. At this time in my life when I cant trade every day……. not losing what we've gained moves front and center. It's just a great feeling to watch your brokerage account hold steady in a sea of red. Thanks Teacher.

- Livingfull

As a retired stockbroker from a major Canadian brokerage firm, I can tell you I would never had access to these type of trade ideas, especially the hedges.
Just closed out a July TZA 40/45 call spread today for a 271% gain in less than a month. I would have normally let that run but yesterday Phil commented to another member something to the effect that "you put down a $1 for a $5 upside, now that you are up 250% you have $2.5 in and you are hoping for a double."
Just closed out a USO July $38 put that Phil suggested yesterday for a 49% one day gain.
Thanks,
Bob

- RJK

Phil – great calls this past week, esp. friday and monday. in the old days I would have let Prechter et al scare me into trimming my longs and going short at just the wrong time. your feel for the markets is Tiger-esque. CHK, HOV, BX, TLT and XLF are big winners for me today. My biggest up day in a long time. Thanks!

- Terrapin22

Thanks Phil, your note at the close was responsible for making those silly GOOG sellers pay for my NYC sojourn, nice!!

- zeroxzero

PSW AC Conf: For those who may be on the bubble, I attended my first PSW LV in November. It was a real eye-opener. What I accomplished in a couple of days of exposure to Phil, Pharm, Craig, et al made my previous couple of years of hanging around the web site seem silly. If you are inclined in the slightest, you really should go. Just rubbing shoulders with other PSW members proved to be really valuable. Strictly on the basis of value, it's a great deal. You will have real time conversations with Phil and the gang and they will get to your questions and agenda items.

- Mjjwo9b

Opt, I think the hardest thing is being disciplined enough to trade with you. Atleast now when I see something go in the red I know how much I'm going to loose and that I will profit somewhere else and have enough money left at the end of the day to trade again. Thanks for all your hard work! My stress levels are down 75% and I have even made a small profit in the short time I've been here

- Mopar

Phil / TNA – On Monday you put out the TNA BCS 41/47. As I mentioned I work during market hours so on Tuesday morning on my way out the door (premarket) I put in an advanced TOS '1st trigger sequence' order to fill the BCS. I can control the entry using this method vs. the vertical entry that TOS allows for the BCS. I filled the June 41 long call but never filled the 47 short call. I let that ride into today. OMG ..TNA popped 7.5%!… the $3.60 entry is almost a double! Tomorrow will be a OCO bracket to get out of TNA before Ben speaks. I should be able to preserve 85% – 100% on the trade. For the income portfolio plays in my IRA's, doing very well… I do like collecting premium! Well done and thanks!

- JFawcett

Phil: UNH, hedged stock position, doing great, up over 50 %,

- RMM

Hi Phil,
Thanks for the free disaster hedge ideas. I implemented variations of two of them on SDS bull call spreads and EEM bear put spreads (haven't done the TZA yet) and they really hedged my short term longs nicely today. Makes it seem a lot less like gambling.
You are the man (of the people)!

- Howard Roake

Thanks to Phil (again) for the lessons on the art of the roll, selling premium and hanging tight under fire (particularly in the first hour of trading-MADNESS). Watching you manage the $25KP has really helped my trading in a big way.

- Oknoman

Phil - DIA 107 Calls. As suggested I am taking the money and running to home depot for some shelter supplies! This is the grand finale of several successful trades from you through this roller-coster and as you have further suggested it is time for me to sit back and relax in cash. May even be able to talk my wife into the premium membership after these intelligent trades in a stupid market.

- DOStrade

I have been trading for quite a few years and in good years made about 25%. After joining PSW, I followed closely the PSW strategy and my trading profit for this year is close to 70% to date. For fun, I like to mix in a few "Hail Mary" plays that really worked out well, but overall the simpler Buy/Write strategy, as presented by Phil so often, created the majority of the profit.

- Gel1

Way to go Phil! Have I said how much I appreciate your site lately! Your ability to teach and your willingless to give others a forum to demonstrate their own skill sets makes your site remarkable. I got great help from you, jmm1951, and Iflantheman (special thanks!) today. Hell, if I have many more days like this I may even be able to sign up for a full year rather than doing it just quarterly. Tomorrow is another day but, fabulous job today!

- dclark41

Gel1…..I've been here 6 months, mostly watching and learning. Lots of smart people on the site and I've learned a lot from Phil and many others. //// Inflan - I have to trump your sentiments regarding the wisdom of the board. I have to thank Phil and the many contruibutors for a 80% profit for 2009. I have learned a lot and am still learning ( even occasionally about political issues - ha! )

- Iflantheman & Gel1

Phil, those OIH $80 p that you recommended last week for ~$1 are now worth $5.50!

- Greg

Thanks, Phil!!! I just crushed today with it with silver (SLV) calls today, thanks to your persistent reminders of how ridiculously cheap it has become, and watching my TSLA this week $240 puts dissolve into chump change added an extra note of amusement.

Nobel – I think there weren’t too many good candidates this year and the prize is often used to make a political statement and this is more a slap in the face to Bush than a real prize for Obama. What’s really silly about it is that the nominations for the prize were due about 2 weeks after Obama was sworn in. I suppose the US President is always nominated but even I, who is very happy with Obama, think this award is a bit premature. Ironically, the prize is being awarded on the same day we begin bombing the moon….

Everyone knows Nobel devalued and politicized their award long ago. Its not Obama’s fault he won; perhaps he will do something someday to deserve it. The whole thing is silly.

Baidu getting major pre market pump on price target upgrade … I think this will get sold into (and the PT upgrade was probably released to clients earlier in the week, as the thing already ran 50 points in 3 days.

OK, we’re still watching the tops of Dow 9,829, S&P 1,071, Nas 2,146, NYSE 7,047 and RUT 620 – bears should freak out if ANY of these get crossed today.

There is no downside targeting at the moment, we’ll just be looking to get back to Wednesday’s levels (around Dow 9,700, S&P 1,055), which is down around a point from here and, below that, we’re looking at the 1.25% and then 2.5% rules. I doubt we fall more than 2.5% on a Friday though but, if we do, then we’d look for downside follow-through on Monday as it will freak out the international markets, who are more overbought than we are.

My pick on the ERY Nov $12s at $1.75 was because we had a silly $1 spike in oil right into the open that was pure BS and, without it, ERY would have been up .50 at least and I expect that we will get there. Also, David made DUG an Oxen pick this morning so I like the fact that we’re both seeing it.

No change in status on our covers yet, we still could go higher and retest the highs as the volume is very low this morning so far.

GM’s China sales surpassed expectations, hitting a monthly record of 181,148 units in September, helped by a government stimulus package.

This is interesting too:

Canada reports a surprising net job gains of 30,600 in Sept., compared with the consensus forecast of a 5,000 increase. The jobless rate fell to 8.4%, down for the first time since July 2008.

How can they be off by 500% in their forecast? Is it really possible to be that clueless? Don’t forget Canada is like Australia, with a small number of people to support and plenty of commodities to export. That is a really amazing number, it means about 1.5% of the populattion got a job last month. Of course, you have to actually read the article to get to this part, which kind of changes the tone:

However, Statscan said the net employment gains in September were all in the public sector while private sector employment actually lost 17,100 jobs, suggesting big private-sector losses outside manufacturing and construction.

Bombing the Moon- I have been warning about this for years. If this goes forward I fear the Moonmen will undoubtedly organize clandestine terrorist groups which will flood the earth through out porous celestial borders seeking free health care and destruction of US infrastructure. Poets have long recongnized the powerfull effects of moonbeams have upon men’s souls. This is a catastophe in the making! On the plus side, this will give the UN something more productive to work on.

DUG at $13.36, selling Nov $13 puts and calls for $2 nets $11.36/12.18, 14.4% if called away is not a bad way to play.

DB raised their Semi outlook for 2009, jumping SOX 1.5%, there’s our sudden rally. Also oil jacked up to $72 again despite the dollar holding up at $1.59 to the Pound, 1.473 for the Europ and 89.45 Yen at the moment. Copper is back down to $2.85 off $2.90 yesterday and silver is down to $17.25 from $17.85 yesterday. Gold is still $1,050 but that silver number should have goldies spooked if it doesn’t pick up soon.

As usual, I’m short oil at $72 in the futures, the play is short at $72, DD at $72.50, out at $72.75, looking for $71.25 with a .15 trailing stop at $71.75 that grows to .25 trailing stop at $71.50.

Moon/Pstas – Absolutely, this is an outrage. Even if we accomplish our mission, are we really prepared for nation-building on the moon. I would think Obama would remember the "Potter Barn Rule" by now!

Volume/SS – Really in vacation mode already. A lot of people taking long weekends.

JOLT Survey: Job openings were little changed at 2.4M in August, now down 50% from the July 2007 peak. Hires were also unchanged at a low 3.1%. There are now 6.3 unemployed people for each job opening.

I guess we should all be emigrating to Canada…

URE at $5.80 can be played up with a stop at $5.69 to protect against a real BS move higher.

VZ now at first level of support. Watch carefully, but the 29 Nov P are 1.02. I think they will break through on a pullback, so 28 Nov P for 80c or better and potential enter there, or buy outright and just sit and wait. Low for the yr is 23.07, but that was a freakish dip, really it is ~ 25.5ish.

Phil, your explanation was deep! Thanks for the tips, which I think reserves for the pros who have the nerves to hold on.

pstas, Current SPX strikes are Nov 920, 930 and 940 short PUTs (not wanting to go 950 yet for fear of a big pull back). The short CALLs are at 1140, 1150 and 1160. SPX has support at around 1000 and I would imagine that 1100 would be some sort of resistance. If SPX doesn’t break the Sep high of 1080, I’m ready to roll down the short CALLs, since by that time, there is less than 3-4 weeks for SPX to try for another breakout.

balancenv, nice job on the Theta comparison. That’s a faster way to answer it. I think Phil answered the other question on the guideline for rolling. The key is to realize there are emotions involved when the paper loss gets larger and larger, so for beginner I’d say roll when the short strike is breached and hold for a day. This is especially true in the Expiration week, as the shorter term Callers would have very high Delta that kills us, rolling to next month can reduce the Delta and lower the damage caused by the move in the wrong direction. Then you can roll the Callers up (in the same month) on a dip. For example, if RUT is at 630 next week, and we have the Oct 620 Callers, then roll to Nov 620 Callers. If and when RUT dip back to 610 in the future, quickly roll it to Nov 640 callers, which was the intended roll, but you’d get more credit with this move. This is a high percentage play as our October Caller was has a big OTM cushion and rallies tends to have pull back.

So find a scheme that can support your trading experience and emotion, and stick to it for a while until you are more comfortable with market moves.

Canada/Raulsm – OK, I should have specified working age population. Meanwhile, if you’re up there, a case of Brodeur’s would make an excellent holiday gift for me!

TBT/Peter – ROFL, up 5% since yesterdy’s bottom already! I love it when a plan comes together….

FAZ/JRW – I prefer to play the FAZ long as a 10% gain in the financials will send FAZ down from $20 to $14, which is something you can recover from but if you short FAS and the financials gain 10%, you will get a $25 pop in your face. Also, with the intense premiums on the ultra, you can hedge FAZ with the Nov $19 calls at $2.90 and $18 puts at $1.65 for a net $15.20/16.60 entry so our $14 drop (30%) won’t really kill us. You can’t cover FAS like that.

OIH/Yodi – I’m not clear on that, why would I SELL an OIH put?

DMan plays – Nothing really. We’re in the same position as yesterday – just seeing if they can actually get a break up on low volume, which I doubt. I like the same entries today that I liked yesterday for the same reasons – we’re not very far from our breakouts where we can stop out or cover with fairly little damage (especially if you use our DIA hedge) so it’s worth risking some naked entries here until we are forced to capitulate on easily identified levels.

Speaking of risk – if you don’t like an October positioin enough to roll it to November (one that you own, not sold) then get out of it. Holding an October contract into expiration week is nuts unless it is specifically a momentum trade that you are very comfortable with.

Deltas/OldG – It depends on what strategy you’re employing. There is something called delta-neutral trading where selecting by deltas is pretty much all you do…

Analysis of Treasury Dept. data show new mortgage modifications fell in September. The agency Thursday said loan modifications rose to 487,081 by the end of September, but those are cumulative figures.

BIDU $430s can be sold naked for $7.20 or covered with $460s at $1.25 to cut margin. This is not so much about counting BIDU out from hitting $436 next week as it is them not hiitting $490 by November as the Nov $490s are an even roll at $7.30 and THAT’s a risk I’m willing to take.

Short strangles- here is an interesting tome on RUT option expiration issues. I don’t get how there can be that much movement in the final settlement price (sounds like a Chicago election- "let’s see how many votes we need then we can fill out the ballots")
But the moral of the story seems to be that if close at expiration, get out or roll.http://www.poweropt.com/am_pm_settle.asp

Hey drum, that play works out well. Looks like AAPL is higher now than when that play started, but the 220 CALL value is less. My suggestion is to wait and not sell the Callers as AAPL may jump on earning. If that is true, you may be able to sell a higher strike caller into the excitement for more credit.

Remember, what do I know ? But yes its overdone big time. SHOULD retrace. The problem with this type of stock is the momo traders go wild chasing breakouts. But once that ends; look out below. Would have happened today I think if not for this "news".

Meanwhile, the Oct 430 call I sold the other day — I am only down $1.50 on it, so I will wait out the decay (I hope).

Phil:
If you’ve got long positions to protect with mattresses, an issue is how many DIA longs to buy. Is "the generally accepted"method as follows? Assume you’re going long on the Jan 99s. You want to be able to cover a 5% drop in the Dow (say 500 points.) That means you want to be able to roll your putters even into Jan 94s (spread of 5). Look to the front month (Nov, Oct is passing) that allows you to roll even to the Jan 94s. That would be the Nov 98s. Assume you do full covers on the Nov 98s. Your net cost (longs minus cover premiums) is then about $2.77, meaning a profit of $2.23 ($223 per contract) in January on the Jan 99/94 bear spread. If you estimate that a 5% drop on the Dow costs you $30,000 that you’re trying to cover, the number of contracts required is $30,000/$223.
I understand that in theory you could choose any method that makes you comfortable. But if we want to follow your mattress covers, we can’t be arbitrary in how we determine the number of longs; we have to have a method that’s consistent with what you’re doing.

Did you guys look at your 401k statement for the quarter ending 9/30. That must be a worry for the bear as my account nearly recouping the loss since 2008, meaning people could feel compel to put more money into the market. This balance catch up may not true for you, depending on when you started the 401k contribution. On the other hand, the contrarians may find that the current run is close to the top if there is extraordinary exuberance!

Morning Phil I am worried about the PARD spread we took a while back: buy PARD 7.75 sell Dec 5 calls and puts for 4.40/1.75 now the stock is 6.77 and the Dec calls and puts are 3.40/1.75. there is tones of activity on the put side with PARD, is the activity strange enough to scuttle the spread even and get out ? or the spread is safe enough to stick it out, which i think it is, but things are strange and i wanted to see what your feeling is.

Cap,
Hey , would you please add aapl to your ‘want to drop’ list as a favor to those guys who are lomg in it and want to see it break upwards from the 52 week highs.
btw what did you think of that ‘conservitive’ 100 point uphrade to bidu??

Delta neutral/OldG – Too tedious to me although I suppose I am delta-neutral anyway as I balance the portfolio. I prefer to look to win every trade and some trades I want a high delta (like the ERYs this morning or URE mo play) and some trades I want a low delta (like the DIA covers) depending on what I think will happen during the contract period.

According to the Fed’s latest figures, bank loans to business are shrinking at a yearly pace of 28%. "The question is whether the decline in lending will be reversed soon." Remind me why we gave them $1.3Tn of taxpayer money again?

The decline in bank lending mostly affects smaller businesses. Larger corporations have alternative sources of funding, including retained earnings, corporate bonds, securitized loans and new equity. Those other sources of capital have increased in recent months, but not enough to offset the decline in bank lending.

In the first and second quarters, the U.S. private sector consumed more capital than it raised for the first time in more than 60 years. Negative net investment is "the hallmark of depression and difficult to reverse," said economist Leigh Skene of Lombard Street Research.

The big drop in credit also shows up as slower money growth. In the past 13 weeks, the money supply has fallen 0.3%. Most new money is created by borrowing, as banks credit the borrower’s account with the proceeds of a loan. Conversely, the money supply is reduced when debts are paid off or written off. Deflation is not a threat — it’s already here.

OIH/Yodi – OK, that’s better then! I like the Jan $115 puts at $6.50, selling the Nov $120 puts, now $5.15, for no less than $4.75 (if OIH over $123.50 I think). That puts you in a very reasonable spread or otherwise naked through earnings where any miss or poor outlook from the group can give you a very nice gain. If at any point you can get $4 or more for the Nov $110 puts (now $2.30) then absolutely take that for a great spread.

Bombing the moon/Cap – I head that Obama had intel from a guy who knows a guy who used to work in an embassy near the moon that there were WMD’s up there so this first stike is fully justified..

Mattress/Chaps – Wow, if a 5% drop in the Dow is going to cost you $30K, you are pretty bullish! Ether that or you’ve got a high six-figure portfolio I hope. In either case, don’t try to cover 100% of the drop. How worried are you? 100%? 75%? 50%. You don’t want to paint yourself into a no-win corner (except for when you are purposely putting on the breaks like over a weekend). Generally, just like any insurance, you want to mitigate your damages, not spend so much that you win when you lose (only Goldman is allowed to get those deals). Better to assume $20K of the spread is adequate and you’ve still got $10K on the side to roll the putters or add more long puts etc on the way down.

11 am volume 42M – 50M is a normal Bot day’s trading. Obama holding up the markets I think so watch when he’s done although, of course, he does tend to push us higher and we’re still within striking distance of a breakout.

Speaking of Bots:

The Fed is reportedly setting its plans to drain record amounts of cash from the financial system by accessing funds through third-party clearing banks in order to enable reverse repurchase agreements. The central bank faces a challenge in conducting reverse repos without constraining the capital of the 18 primary dealers who would normally be sole counterparties to the transactions.

Oh no, now the CDC says all 50 states have swine flue and 39 states are in epidemic already! How the hell did that sneak back up from no news at all since we last discussed it? RAD at $1.57 is a fun way to play, looking for $1.90.

The deficit was the result of a 5.1 percent drop in exports to C$29.22 billion and a 2.8 percent decrease in imports to C$31.20 billion. Analysts had expected exports of C$31.03 billion and imports of C$32.16 billion.

Exports fell in all sectors in August, dragged down by machinery and equipment sales and specifically by exports of aircraft and telecommunications equipment.

Highlander; I don’t place much interest in analyst price target moves. They were at 380; the stock was at 415. So if they were bullish on it; it makes sense to up the price target. Beyond that who knows.

Oh Boy !…Carter won the prize, and he did WONDERFUL things for the economy while President - Does this mean Obama will also do the same wonderful things? This is what can happen when peanut farmers and community organizers become world class economists overnight, with no formal training. They also share a similar expertise – total confusion over what needs to be done in Iran. End of editorial.

MOON- this could spin out of control quickly. Why, the moonmen could embargo the next full moon and with Halloween just around the corner, then what? Terrible consequence. Halloween could be cancelled and then I would have no good excuse to stock up on Snickers bars ("It’s for the kids , honey").
We need to appoint a Special Ambassador to The Moon post haste. I wonder if Jerry Brown is still around? (remember Gov.Moonbeam?) or maybe we could resurect Ralph Kramden ("to da moon, Alice"). Come to think of it , we could appoint Geitner or Bernake or any White House/Congressional staffer- they all can relate to things that stretch to the moon (deficits).

PARD/Micro – These biotechs are crazy-assed gambles at the best of times. PARD is going to go up and down based on rumors of study results and if you are not willing and able to see PARD go down to $2 and up to $12 while you wait for Dec expirations, get out even if you can. When we were long on DNDN (who WERE victorious in the end) in 2007, they were driven down to about $4 from $10 before they went up to $20 and then over the next 2 years they went down to $2 just days before heading up over $20 to stay. There is no funamental factor you can cling to on these trades – Cramer’s hatchet men print good or bad articles whenever his fund buddies need a push one way or another and all it takes is a few thousand Cramerites to buy or sell $5,000 worth of PARD and that’s 3 days of normal trading ($1.2M is normal) jammed through in a day. Picking biotech stocks is about sticking it out to the end game but, of course, when you do get a silly spike, like DNDN in 2007, you just take the money and run as it’s very likely you’ll get another chance before the final approvals.

OK, my new plan for a market recovery is just to have Obama come on every morning around 11. He could probably do shadow puppets and the market would jump… Maybe we can get Bush to come back and say something whenever we need the markets to sell off again!

Double Top/High – Ah, but are they trying to force a double top or a breakout?

URE back down to $5.80 again but failed it. I’m back in if they cross up again but I doubt it.

cap,
this whole moon shot thing was a gw plan carryover and it just fell through the o’bama administration and everone knows gw is not from this planet or texas even!! he was just pis*** at some other alian base up there!!

Phil, question here , do you mean buying the Jan 115 puts and selling thhe NOv. 120 puts? so in the trade for $6.50 – 5.00 or so for $1.50 debit and you are in the upside down sp read of 5 points 120-115 exposure, for $1.50, not clear on this…
OIH/Yodi – OK, that’s better then! I like the Jan $115 puts at $6.50, selling the Nov $120 puts, now $5.15, for no less than $4.75 (if OIH over $123.50 I think). That puts you in a very reasonable spread or otherwise naked through earnings where any miss or poor outlook from the group can give you a very nice gain. If at any point you can get $4 or more for the Nov $110 puts (now $2.30) then absolutely take that for a great spread.

Also, how about on SRS, selling both the Nov. 10 calls and puts bringing in 2.25 credit, with SRS at 9.82. does this make sense? and then if the stock drops you can buy it cheaper, and if exercised on the puts, you own it even cheaper….

Phil i like CAT but think the price around 55 is a good time to get bearish on the stock with earnings on the 20th, how would you play this?

Cat continues to layoff employees and will raise prices on equipment for 2010

“Many of our plants around the world are conducting what we call rolling layoffs and/or rolling shutdowns, which are the short, one or sometimes two week defined periods when a plant or portion of a plant is idled,” Dugan said. “We typically do this in order to reduce the need for permanent layoffs.”

Also, he said, these decisions are made to “manage production levels in line with demand.”

Caterpillar anticipates global economic growth of 2.2% growth in 2010, following a forecast decline of 2.2% in global gross domestic product in 2009. Demand for construction equipment has fallen sharply this year, prompting Caterpillar to lay off tens of thousands of workers and idle assembly plants to lower its fixed costs.
But material costs, particularly for steel, have remained stubbornly high compared with previous global economic downturns. By raising prices on machinery Caterpillar will be able to offset rising material costs without eroding profit.

SPPI/Dia – as with any FDA review, some see it one way, others another. At this point it is too hard to tell. The drug is already approved, so it shouldn’t hurt current revenues. They were looking for line extension in colo-rectal cancer. They have some support around here, but not sure what you have. If you have the stock, I would cover a bit more and wait for things to settle down. 5 Nov can be used as a cover 3/4 . If they start up, then you can sell the same 5 puts to help pay for the roll to 7.5 Jan.

Arbitrary/Chaps – That’s fine but same concept applies no matter what. You just need to assess your risk and then decide what 100% coverage would be and then decide how worried you really are.

Canada/Kustomz – That goes with that other data, jobs mainly due to government, not real business activity.

SPPI/Drum – I don’t know how bad that news is for them but it seems to me there’s little ownership premise at the moment so you’ll be lucky to hold the 200 dma at $4.15. I assume you’re in for about $5.50/6.50 so I’d sell the Feb $5s for $1.10 while you can and roll the $2.40 $7.50 puts to 2x the Feb $5 puts at .90 so you pick up net .70 and your basis drops to $4.80/5 (but 3x if put to you at $5). You can put a $1.50 stop on 1/2 the calls or just buy another round of stock over $5.50 or you can buy the 2011 $5 calls, now $1.75 if they break back up on you.

SKF/Concreata – This is why 20% stops (or action at least) can save you money. I agree with the veritical idea, no sense in spending much more when you can move to the Jan $21/25 spread for $2, which puts you $3 in the money on the $4 spread for an extra buck.

Rates are going up fast!

Dollar/Allen - I’m really happy with the TBTs. Dollars get more valuable and you have to pay up to borrow them too. UUP is a fun play and you can go with the Dec $22/23 spread for .55.

Brown/Pstas – That was a good one! I wish you hadn’t explained it as I would have gotten it about an hour from now… Frank Zappas daughter should have a say in any lunar policies too…

30K/Raulism – Oh, the decimal thing! That’s totally different. I did know that it was 20M, not 2M. I blame Obama and his crazy energy policy for my poorly functioning solar calculator (right Cap?).

Moon – why don’t we just hire Sir Roger Moore as the Special Ambassador? He’s been there before with that whole Moonraker experience he partook in back in the day. Surely he can provide us some tactical advantage.

China the manufacturing engine of the world, is this a sign? Americans becoming Atheists
They even make the Christmas trees that are exported to America’s K-Marts, Wal-Marts and a dozen other retail chains.
But this year the Christmas forecast is looking a bit bleak. Orders for American retail stores are down 50 percent. The Wong’s Christmas tree factory is churning at two-thirds instead of full speed.
The entire Chinese town of Yi Wu is feeling the Christmas pinch. The mile-long town is home to the biggest small commodities trade market in the world, but the whole area is feeling a hampered Christmas spirit.
"We’re not thinking about making profits this year just try ing to keep our business going," Wong said.
The largest factories report sales slumping sales down 30 percent. And in a town known by many as the Wall Street of counterfeiting, even knock-off watches are on sale.http://www.foxnews.com/story/0,2933,563082,00.html

cap,
if andrew hall doe not get his $100m bonas, it will be an outrage!! why should a man who owns a 1000 year old castle in Germany and collects nazi atrocity art be compromised by a blatant socialist like o’bama? where in the hell are the principles that made this country great?

OIH/Dman – Yes buying the Jan $115 puts and selling the Nov $120 puts IF OIH went higher and triggered the sale but it looks like that’s not necessary as the Nov $120 puts are now $5.55. On SRS, you keep asking about naked short strangles on 3x ultras and I keep telling you they are dangerous so what do you want me to say? If you don’t mind owning them then man up and buy it so you have a buy/write. You can do the naked strangle with, say, a half buy on the ETF and stop out at $9.50 and double up (to a full buy/write) at $10.50 – that’s not too risky.

CAT/Kustomz – I don’t think I’d short them with the dollar so low last Q. They could have picked up a ton of contracts as other governments plowed money into infrastructure. Those layoffs etc didn’t hurt them last Q, when they jumped from $30 to over $40 on earnings. I’m not long but I think they are simply a "stay away" as they are still 60% below the highs. That being said, earnings are on the 20th so after expiration and you can sell the $52.50s for $1.42 naked and those should roll to the Nov $60s if you have to (as they should hold value due to earnings) so a quick pickup of $1.42 for next week very possibly. Because of low long premiums vs current price you can also backspread them by selling the Nov $55s for $2.30 and buying the May $65 for $2.64. If they head higher, you would have to DD on the Mays and roll the Nov to 2x the Jan $60s and hope for the best.

Icahn on CNBC this morning: We’re at a precipice – it could go either way from here. (video, 6min.)

Woo-hoo – Jackpot on oil!!! $71 without stopping out!!!!

Flu/CXT – Hey that sucks! Please let us know how that goes (how long, how bad) as we need lab rats to try to guage the overall impact. I’m going for the inhaled vaccine this weekend.

CAT/1020 – CAT is a virtual cartel as they control a huge percentag of global equipment so if they stop making it, they create a shortage. Last Q they made $371M on $8Bn in sales so a 2% rise in prices (which don’t incur new costs) drops $160M to the bottom line (less taxes). That’s very significant and can take their EPS from .50 per Q to .75+ without even rebounding sales. Also possibly bullish for CAT is more than 50% international sales may be paid in foreign currency which could give them a huge conversion bonus.

I gotta say, I love the fact that you can have a week with some spectacularly crappy trades (like me selling FSLR calls earlier this week, then bailing out at the worst time), yet nonetheless have the slow, steady drip of premium collection put you well ahead by the end. I don’t think life is so easy for those poor stock trader dudes.

Kustomz I gotta mention the bullish side of the rolling plant closures for CAT. I think this means management is forecasting a pickup in demand over the course of 2+ quarters. Otherwise it would likely be cheaper to lay the workers off and rehire them later.

Phil With reference to yesterday’s GLD advice reproduced below……GLD/Magret – Ah but you did not get out at $101 as recommended. That’s OK, I didn’t either.. Like the FCX adjustment for Japar above, once you are behind you try to get even, not ahead. Step 1 is we can get paid $1 for selling the Oct $93 puts and that pays for a roll from the Nov $101 puts to the Nov $103 puts right there. Those Oct $103s can then be rolled down to the Nove $99 puts if things do turn our way and we’ll be thrilled with that..
Do you think it’s time to roll the Oct 103 to the Nov 99…….

Moon – Hopefully there is no intelligent life in outer space because inevitably, we’d end up having very embarrassing conversations with them where they would ask us "How many moons you have?" and we’d say "One" and they’d say, so what do you call your moon and we’d say "the Moon." I mean that is just sad….

Atheism/Kustomz – Well for one thing there’s no collection plate… I think it’s just another sign that XMas is going to be WAY toned down this year and I can’t believe all this optimistic BS I’m hearing from the retailers. Back to school sales are not optional – kids need books and kids need clothes but XMas is a luxury item that used to be celebrated (very nicely if I remember) with a few small gifts under a tree as opposed to the room full of crap we’ve gotten used to this past decade.

Premium collection/Eric – Yep, gotta love it!

ZION under $17 – Danger Will Robinson! Warning! Warning! XLF $15 is next domino to fall, then Qs at $42 would be next to watch…

WHAT????? Obama back on at 2pm??? Holy cow this market is nuts!

GLD/Magret – Based on today’s info I would roll to less than a full cover, worth taking a chance on 2/3 cover I would think.

CAT thanks for the input but i think global spending (stimulus) has peaked and hasn’t done much to reverse the global slowdown. I believe in V recovery. GS can always buy a few billion from CAT and park the equipment in some of the empty gargantuan manufacturing buildings that are now empty in China, kind of like what Merrill Lynch did with barges back in 2000. "nobody was buying, so Enron contacted Merrill Lynch, which agreed to "purchase" the barges with the understanding that Enron would buy them back with interest within six months. Six months later"

Daimler Trucks Sees ‘Slight’ Sales Improvement
Globally, “we’ve seen sales decrease more than 50 percent on average,” he told reporters at an Oct. 8 press conference in Washington. In the U.S., Canada and Mexico, medium- and heavy-duty truck sales are down 45 percent year to date from the same period in 2008, itself a dismal year. Sales were down 43 percent last year from 2006.
From the bottom of that down cycle, however, things are looking up. After two years of job and pay cuts and a reorganization, Daimler Trucks North America, which builds Freightliner and Western Star trucks as well as buses and diesel engines, hired about 600 people this summer. “We’ve seen a slight increase in our order intake,” said Martin Daum, president and CEO of DTNA. “We’re hoping that can be sustained.”
The economy seems to have hit bottom, said Renschler, and for Daimler “it’s stabilizing and in some markets slightly improving.” But “slightly” is the key word.
“We are not expecting that this will all be over in two years,” Renschler said.
DTNA expects sales to improve 10 percent at most in next year over 2009 levels, “which is still a very bad market,” said Daum, worse, in fact, than 2008.http://www.joc.com/node/413887

RSX Nov $28 puts for $1.15. There’s an example of a position where you don’t want a high delta in case you are wrong but we’ll be looing to make .50 or scale in with a roll up if it goes the wrong way. This is also a short oil play more or less.

Thought you might like to know…. I’m getting rehired by my former company. It’s one of the reasons I’ve not been around to chat and gripe about the stock market lately. I’ve got to relocate to upstate New York and will be working at a nanotechnology research facility in the Hudson Valley area…. near Poughkeepsie.

Maybe things really are starting to get better? My company says business is definitely getting stronger in the semiconductor area.

MOON- Ok, I can agree the Moon Unit Zappa get appointed to the soon to be assembled United Nations Intergalactic Moon Relations & Global Warming Council. However, I demand that her brother , Dweezil , also be appointed since he is much more qualified because I think he has a better name. We could also appoint former Oakland A’s pitcher John "Blue Moon" Odom-who’s reputation for fisticuffs would send a signal that we won’t be pushed around. We can offset that beligerant image by appointing former Houston Oilers Q-back Warren Moon. He played a number of years in the Canadian Football League- that would enhance our peacekeeping intentions. Besides, these two could dazzle the moon men with 90MPH fastballs and thread the needle spiral passes while GS gets busy cornering the Green Cheese futures market.

Strategy for rolling buy/writes:
Phil, I have a TASR buy/write: bought the stock at 4.75 and sold Oct puts for .69 and calls for .16; total credit = . 85. The calls will probably expire worthless and I could buy back the puts for .45 or .50 today. I might be able to roll to the Nov 5 puts and calls which would bring in a bit under .30 credit (assuming I let the Oct calls expire). That does not seem like a lot but, as you have written in the past, .30 x 12 months = 3.60 which is not bad for owning a 4.75 stock. Or i could just roll the put side to Nov now and try to get a bit more for selling the Nov calls next week. I am less concerned about the specifics for this trade but more interested if I am evaluating how to manage this properly. Thanks.

Hi Phil: What’s your take on LINE. We seem to have enough natural gas for the next 100 years ,but the stock just keeps going up. I’ve got a large position which is up 60 %. Is just that they hedged their production fofr the nx 3 years which assures the 10% + dividend or is it something else I don’t see.
dflam

Highlander – I could give a damn about Andrew Hall and his bonus; and if he collects Nazi "art" or whatever then he probably deserves some agida.

That said, in general, companies should honor contractual deals w/ employees; if they made a bad, stupid or costly deal; too bad for them. Its also none of the gov’ts business unless fraud is involved.

Pharmboy: wait to last hour, it will go down. Maybe I should say go up as it mostly goes the oppsite way as I think.
I get tired and frustrated, for how many months did we have anticipation of drops (thats why I am underinvested) and the market went mostly up, now a few bearish bets are really hurting.
What is so great about BIDU that it is up that much ?

Im going to play it safe and say UP! I have lost a LOT shorting since May as well… I dont want to be a bear but how can one be a bull with so much bad news? Ive definitely lightened up on the shorts though, if I stayed the course Id be broke before this mythical crash happened!

Economists surveyed by Bloomberg News say U.S. consumer spending will wane if unemployment surpasses 10%. Rising unemployment “could be enough to push the economy back into recession,” said Gus Faucher of Moody’s Economy.com.

Cool, oil heading back for a possible reload, $71.67 already…

Speaking of SOX – Congrats Merk! They sure are getting lots of upgrades so maybe that is our greenest shoot.

Moon/Pstas – We have a joke rule in our house with the kids: 3 times is funny, after that it’s annoying…

1pm volume 71M, about 20M light of a normal low-volume day.

TASR/Allen – They got bonked down from $4.90 last week so I wouldn’t rule out a move back up. .40 was the best price for the Dec $5s so no reason not to take .30 for those and you should be able to roll the Oct $5 puts to the Dec $5 puts for a .25 credit so that’s another .55 off the basis. On the roll, you’ll get it on a move up because of the delta differential. You may want to treat yourself to a few 2011 $5/7.50 spreads for .50 when they fill. Every time you have a good month, you can take 20% of the profits and add a few until you build up a nice long position that will let you roll callers to 2x on a run or let you cash out your longs without fearing a run-up.

LINE/Dflam – They seem like really good operators to me. They have oil and gas and with both much improved this year, I wouldn’t bet against these guys. Yes, Mike Linn owns 1.2M shares and he’s happy to lock in that $2.52 dividend so that dows make them a nice dividend play. The stock is $23.67 and you can sell the 2011 $22.50 calls for $2.50 and the $20 puts for $2.80 for net $18.37/19.18 so a nice 20% cushin and $2.50 coming to you over 12 months is another 13.6% but you are going to want some sort of oil hedge along the way – just in case….

Semis – Oh, that reminds me, I do think that the smart-phone wars and the new IPad are driving a lot of the turnaround in semis. Growth is growth but it’s a pretty narrow catalyst. Also, TV sales are strong because 18M people may be unemployed but that doesn’t stop them from buying a new 42′ flat screen at WMT for $700 for their extended couch time.

Moon Unit/Cap – I think she’s an actress now, must be about 40. I wouldn’t know her face but I’m sure I’d notice here name on something if credits rolled by.

Rally caused by: Fed Vice Chairman Donald Kohn: Anchoring inflation expectations has been a difficult achievement decades in the making, and "we should not take this stability for granted." The Fed has stopped short of the academic view that it should encourage some above-normal inflation, due to the real-world chance of inflation fear spinning out of control.

WTF? This guy just undid all the strong dollar talk from everyone else! Is he crazy or is this on purpose. Maybe the plan was to have all the top-level guys go on record supporting the dollar and let Kohn undermine the whole thing by whipping up the inflation talk in the afternoon…

This seems like a good time for a level reminder: Dow 9,829, S&P 1,071, Nas 2,146, NYSE 7,047 and RUT 620

Peter D
?Current SPX strikes are Nov 920, 930 and 940 short PUTs (not wanting to go 950 yet for
fear of a big pull back). The short CALLs are at 1140, 1150 and 1160.
Could you clarify? Are you taking positions in all of these strikes? If so, what is the strategy?

Cap, I started with a BIDU vertical of OCT 400/390 puts, and after some rolls am at the 430 puts w/ 1/2 cover of 410s. Luckily I paid for most of the rolls by having a GOOG call sitting out there. done with that.

LINE/dflam- I also have a fair amount of LINE. Probably would not apply to the leaps but the fat dividend makes it vulnerable to early assignment on front month covered calls as happened to me the day before the record date. Perhaps you have had the same issue? Ticked me off as I had that check snatched right out of my hands.

IBM My spread is +1 Jan 100, +3 Jan 110 / -2 Oct 120. Two questions: when should I be looking to roll my long calls? I can roll the Jan 100 --> Jan 11 105 for a credit, which seems pretty good to me. Also, should I stay in half covers all the way through earnings? I’m planning on it since the callers still have decent premium, but I wonder if I should roll them if they get too far ITM.

Does anyone know the ex-div date for LINE? The divi is so good that puts and calls are really cheap. So a collar trade selling the Jan ’11 22.5 C and buying the Jan ’10 20 P gives a 2.05 credit. Stock at 23.65 – 2.05 = 21.60, or about 1.60 total risk (but of course you must buy another put after Jan). This is another possible ‘mom IRA account’ position, methinks (mom doesn’t like risk).

Phil.
How do you feel about the close ? I would doubt that they could push for new highs with no news and a stronger dollar, on a Friday. But maybe because that makes sense, the opposite could happen. Regardless, I have a rather large possition in TZA at $ 11.46 and am wondering about the weekend.
Thanks, J.R.

RSX/Yodi – Not for me, I decided to get more EDZ as it’s a similar play but I do like the RSX play (Nov $28 puts, now $1.15).

Oil seems to be closing over $71.50, never got back to $72. Gold down at $1,047, silver $17.68 so a good recovery for them and copper is at $2.83 so no good there.

DIA/Cwan – Yes, if we stay up here we STILL could go either way on Monday, especially with the low volume. It depends what you are protecting of course. I’m over 60% bearish so I’ll be a little pissed off if we do break over our levels and that cover takes the sting out and shouldn’t lose too much if we drop 100 (compared to the short gains).

IBM/Eph – That was crazy today. They get called out on anti-trust issues and the stock acts like they won the lottery. You can roll the Jan $100s to 2x the Apr $120s about even and that puts you 5 longs with the 2 covers at $6.20 and those can be rolled to anything but I’d go for rolling them to 6 Oct $125s at $2.75, which hopefully expire worthless and leave you with 5 open longs.

LINE/Eric – They just x’d on 8/5 so you have a wait. You can go in for $23.79 and sell the 2011 $22.50s for $2.50 and buy the Apr $25 puts for $3.50. That puts you in for net $24.79 with a guaranteed sale at $25 through April. So you collect the dividend and if it heads way up on you the puts are worthless and you roll the calls and do it again (but with 3 dividends in pocket) or, if it heads down, you sell your stock for $25 in April and that should mean the callers are cheaper when you buy them back or roll them.

Paul Krugman says you need to read today’s WSJ editorial "The Dollar Adrift" with an eye to the paper’s long-term goldbugism: Focusing on currency stability over domestic recovery is a path to disaster.

U.S. IPOs hit a level not seen since Q1 2008, according to a report this morning by PricewaterhouseCoopers. "Q3 IPO activity is historically slow; however, we are encouraged by the deal flow and proceeds raised in 2009, clearly building upon improvements that began in late March," the firm says, noting we’ve seen 20 IPOs so far this quarter raising nearly $5.8B, nearly quadruple that raised a year ago.

Close/JRW – I’m pretty surprised we have no selling into the close. As above, we need to get as neutral as possible into the weekend.

Random/Pstas – Yeah it’s random, as in if you have the money and don’t complain too much, you go to the top of their random list.

Oil Jammed up to $72 in the last minute, no shorting now (not the futures anyway).

http://washingtontimes.com/news/2009/oct/09/exports-increased-slightly-trade-deficit-narrowed/?feat=home_headlines
America’s cumulative trade deficit for the first eight months of 2009 ($238 billion) is running 52 percent below its January-August 2008 level ($491 billion). That reduction is mostly attributable to the recession, which deepened significantly beginning in September 2008.
Most economists expect the dollar’s declining value, which makes U.S. exports more competitive, will spur an increase in U.S. exports, especially after foreign economies begin to recover more robustly.

DIA- moldy oldies- Ah, much better now thank you very much.
Long Jan 100 w/half cover Oct 98′s sold at $1.15. Tempted to take these out and play for a sell-off and reload into the close?
Or am just getting greedy?

Thanks Phil and jomptien. Yodi, yeah: I’m rolling up the long call if it keeps up, but I’m fine with that. As long as there is a decent amount of extrinsic on the long call, you can’t lose to the upside because if you are assigned ahead of the dividend, then you keep the fat call extrinsic.

Interestingly, there is no data until Wednesday next week so nothing to stop this crazy train until then other than a major earnings miss. Starting Weds though, we have huge data including Retail Sales, Biz Inventories, Fed Minutes, CPI, Philly Fed, TIC Flows, and Industrial Production. A week later, on 10/21, we get the Beige Book and that’s always a mover.

So we’ll have a damn good picture of the economy by Friday and Weds, with all that data and earnings can move us 300 points up or down. It’s going to be fun.

Meanwhile, I’m rolling up my short plays (better strikes, more shares) and keeping well covered. Monday will be another low volume day but if they don’t break us over on Monday, that should be of major concern to the bears.

DIA cover stance is still Jan $100 puts, which are holding up well at $5.15 and there is no point to keeping the covers on now so buying out the October puts we sold (up 50%+) and selling 1/2 Nov $97 puts for $2.05.

SAN FRANCISCO (Dow Jones)--The developer and the owner of a 101-megawatt wind farm in northern California said Thursday they’re starting construction on the project after lining up financing from six lenders.
The Hatchet Ridge wind farm, owned by a unit of private-equity firm Riverstone Holdings LLC, will be built on a mountain ridge in Shasta County, Calif., using 44 wind turbines made by Siemens AG (SI). The project is estimated to be completed by the end of 2010, said RES Americas, which is developing the project. PG&E Corp. (PCG) unit Pacific Gas & Electric Co. has signed a 15-year contract to purchase the output from the facility.
Debt financing for the project is being provided by French banks Natixis (NTXFY, KN.FR), Credit Agricole SA’s (CRARY, ACA.FR) Calyon investment-banking unit and Societe Generale SA (SCGLY); German banks Landesbank Baden-Wurttemberg and WestLB AG, and U.S. bank Union Bank

Phil
Whenever you get a chance can you explain the below para for us. I need some clarity on how we can attempt to get a discount on premium. Are you referring to waiting till the premium gets to 1/2 or is there something else to it? .Thanks.
"
Rolling – Also a good rule of thumb if you are rolling is to attempt to get a discount of 1/2 your callers remaining premium (assuming we are in the last week) to rolll to the bid price or less of the caller you are aiming for. So if I have the RUT $620 caller at $4.40 (not that I would roll him based on my targeting) and I wanted to roll up to the Nov $660 with a bid of $4.40 and ask of $4.50, my calculation would be that I have $4.40 of pure premium so I would offer to roll for a credit of $2.20 (1/2 my caller’s premium gone subtracted from the current bid).
"

Rolling/Chakra – How about tell me specifically what you have as it’s easier than doing abstracts? In that case I’m talking about offering the roll (assuming your broker lets you and, if not, get another broker) at the net price you wish for. When a stock spikes up and down all sorts of crazy things get filled but not if you don’t have an offer out there. The same goes for selling things at good prices – if you don’t ask, you certainly won’t get it.

A "handful of firms" have urged the Depository Trust & Clearing Corp. – clearinghouse for virtually all U.S. stock trading – to act as a marketwide watchdog guarding against computer-driven chaos. Both authorities and high-frequency traders have apparently called for limits that would prevent a malfunctioning algorithm from acquiring a massive position.

ERY/Cwan – Sure, they are Nov and they didn’t do much all day. Jomp is right, I should have gotten out but I didn’t as it was an early scale I’m willing to stick with.

Follow through/JRW – Well we have to look at the 5% rule and this would be a finish on the week that suggests follow-through to the upside on Monday. Those levels are obviously tough to break but what are you gonna do? You have to just go with it once we get over the levels and use the levels for stops.

Wow, 1,071 on the S&P! These guys are magic…

Have a good weekend everyone! I’ll be busy looking for stuff to add to the Watch List, which becomes the Buy List once we go 3 of 5 indexes over.

Phil,
Earlier when you were explaining a hedge to somebody you said that you are not suppoed to make money on a drop (in context, meaning net total gain on your portfolio) but then, if you are 55 or 60% bearish, wouldn’t you make a net gain or is this just 55 or 60% on your mattress play hedge which is structured to defend a certain predetermined percentage of one’s portfolio? Am I understanding that correctly?

Today proves without a shadow of a doubt this market is manipulated (LMAO)and to talk about the moves with a straight face is a strain on facial muscles..fire your financial advisor and pour (poor) all your savings into the markets…

Balance/Aclend – It’s all a matter of personal taste. If you are bullish and hedging (which was the question at the time) then you don’t want to negate your position with covers, just soften the blow if your are wrong. If you are more neutral, like I am, then it’s just a question of an adjustment here or there that puts you from 50/50 to 55/45 or 60/40 one way or the other. The nice thing about playing for balance (with a mix of bullish and bearish positions) is that it is very easy to adjust.

If, for example, you have $30K bullish and $30K bearish (presumably with about the same overall "delta") with $40K of cash on the side, then you don’t have to touch the existing spreads to get more bullish. I can just add $3,000 worth of the DIA $98/99 spread and, Presto!, I’m now 55% bullish overall. If I am in that 55% bullish stance and I want to get more bearish, I just add $3K of QID calls that should doulbe if my DIA calls get wiped out and I’m back to even or maybe a bit bearish.

Then I add and SRS buy/write with 1,000 at $9.60, selling Nov $9 puts and calls for $2.10 for a $7.50/8.25 entry and I’m only a little tiny bit more bearish – perhaps I consider that I have a risk of getting assigned at $7 so that’s $1.25 x $1,000 at risk or $1,250 pushing me to a little more bearish but not much and so on. Generally I look at my risk (what I think the risk is) on each play to decide how bullish/bearish I am overall. Take a look at the original set-up of the first $100KP where I go into the logic on each play. THAT was a nicely balanced portfolio. I’m still waiting for WSS to get it together and come out with the spread order system so I can start the new portflio there.

By the way, you don’t need to knock yourself out with crazy calculations to see your balance. Just keep notes of what happens to your portfolio when the Dow is up 100 or down 100 etc and you’ll know how unbalanced you are. Since we go up and down 100 pretty much every day, you won’t have to wait long!

All your savings in the market/Kustomz – No need to call your broker, your government has already put all your savings into the market. And your childern’s savings, and your grandchildren’s savings and their grandchildren’s savings…

Balance/JRW – Good job! The UREs neutralized the real estate shorts as they busted $5.80 again.

Columbus/Highlander – Aside from the fact that it wasn’t actually America (he discovered the Bahamas) and Columbus didn’t even know it was America or that he had discovered anything at all as he thought he was in India – there is the nitpicky little point that you can’t really say you discovered a place when people are there waving at you from the shore. By that logic, I have "discovered" most of this planet so hurry up and get me a statue and a national holiday!

Here’s a great quote from a Columbus’ first voyage journal:

"Many of the men I have seen have scars on their bodies, and when I made signs to them to find out how this happened, they indicated that people from other nearby islands come to San Salvador to capture them; they defend themselves the best they can. I believe that people from the mainland come here to take them as slaves. They ought to make good and skilled servants, for they repeat very quickly whatever we say to them. I think they can very easily be made Christians, for they seem to have no religion. If it pleases our Lord, I will take six of them to Your Highnesses when I depart, in order that they may learn our language." Lacking modern weaponry and even metal-forged swords or pikes, he remarked upon their tactical vulnerability, writing, "I could conquer the whole of them with 50 men, and govern them as I pleased."

phil,
to close on Columbus, he did have the insight that the world was round and the balls to back up his thesis by sailing due west, and aside from his math error (50%) which made him think he was in India, the earth was indeed round.
the republicans on the other hand, still think it is flat and that everyone on it has all the medical care they could ever need.

Columbus didn’t discover america. Neither did Leif. If either of them did, WHERE IS THEIR BRIDGE? Giovanni Di Verrazano was the true discoverer, and stayed here so long he was able to build an absolutely enormous bridge (http://en.wikipedia.org/wiki/Verrazano-Narrows_Bridge).

Verrazano’s claim to being the true father of America is further reinforced by his shared passion with George Washington, who built an even bigger bridge (http://en.wikipedia.org/wiki/George_Washington_Bridge) and subsequently went on to become the first president!

Well let’s see, we have Columbia (country), all sorts of Columbus towns cities, etc (Columbus Ohio) , Columbia County NY for example. Columbus Circle. Columbus Avenue. Columbia University, etc. He also gets a holiday, Columbus Day, with his own parade.
How come nobody here seems to know Amerigo Vespucci, who after all has 2 Contients and the USA named after him.
Vespucci got all the major naming rights; Columbus got the holiday, a parade, a country and some other stuff. And he may even have won the Nobel Prize in 2003. Poor Columbus.http://www.answers.com/topic/amerigo-vespucci
Vespucci is said to have made a guess at the world’s circumference that was accurate within 50 miles. His real achievement seems to be that he concluded America had to be a new continent and not the eastern part of Asia, as Columbus believed. An honored citizen in Spain, Vespucci spent the years after his voyages as a maritime official for King Ferdinand.

Roundness: In 200 BC, Eratosthenes beat everyone on the round thing. He picked 2 places in Egypt and somehow computed high noon at each city and used the error to deduce the circumference of the Earth. That’s pretty darn clever for the times!

The Mann Booker Prize, Britain’s most prestigious literary award, has been conferred for 2009 on President Obama, it was announced yesterday. Not only is this the first time the Booker Prize has gone to an American. It is the first time the prize has gone to someone who has never published a work of fiction. By the terms of the Mann Booker Trust, the prize is awarded annually to “the author of what is judged to be the best novel published each year in the United Kingdom.” Obama has written two highly regarded memoirs, but neither was published in 2009 in the United Kingdom, and neither is a novel. At the press conference where the award to Obama was announced, the chairman of the judges said, “He’s bound to have a short story or two shoved into a drawer somewhere. That’s good enough for us.” And besides, the chairman noted, it was the unanimous conclusion of the judges that the president’s “whole life is a great novel.”

Although as recently as 24 hours ago, the president’s name was entirely absent from the traditional frenzy of speculation about the Booker Prize, he is now considered the leading candidate for the Prix Goncourt, which is the French equivalent of the Booker and possibly even more prestigious. Among past winners are Marcel Proust and Simone de Beauvoir. Traditionally, as a prize for novel writing, it has gone to someone who has written a novel. Obama got the award, according to the judges, for “smoking cigarettes and wearing those Euro-cut suits and skinny ties, and generally looking like a French intellectual.”

The president is considered a shoo-in for an Oscar in the category of best cinematography at next spring’s Academy Awards. “We had to give him something,” a spokesman said, “and nobody knows what the heck cinematography is anyway.”

Obama is also expected to win this year’s Nobel Prize for Physics, for an experiment he conducted two decades ago in a science course at the high school he attended in Hawaii. By dropping two coconuts from the top of a tower, he determined that gravity works in Hawaii just like it does in England, where Newton had conducted a similar experiment several centuries earlier, using apples, even though Hawaii is much closer to the equator. “Whether distance from the equator might make some difference in the way gravity works is a question that nobody had thought to ask,” the Nobel citation declares. “Now, thanks to Mr. Obama’s research, we have the answer.” Obama will be the first person to win two Nobel prizes in the same year. “Next year, he’s going for three,” said presidential adviser David Axelrod yesterday.

Among other prizes Obama has won or is expected to win in 2009 are Scariest Costume at the annual Halloween Ball of the National Press Club (he came dressed as Elizabeth McCaughey), Parent of the Year at the Sidwell Friends School (“So what if he missed all the PTA meetings?” the citation read), and Most Hot Dogs Consumed in Five Minutes (14) at this year’s White House staff July 4 picnic. A controversy broke out when the Post reported that they were actually veggie-dogs, but House Speaker Nancy Pelosi ruled that the new-age sauages should count. “Next year he’s going for 16,” said Axelrod. “Eyes on the prize.”

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